Sauté onion in butter in a Dutch oven over medium heat, stirring often, 15 to 20 minutes or until golden. Stir in flour; cook one minute. Add water and next 8 ingredients. Bring to a boil; reduce heat and simmer, partially covered, for 30 minutes. Discard bay leaves.

Ladle soup into four individual ovenproof soup bowls. Place on a baking sheet. Add two bread sliced to each bowl and cover each with two slices of cheese. Broil 5 1/2 inches from heat for 4 minutes or until cheese is bubbly. Serve immediately.